Domestic equity index -- Nifty -- ended higher on Monday on account of hectic buying by funds and retail investors in the front line blue chips counters amid firm cues from the global markets. Sentiment remained up-beat after allaying concerns of any impact on India's sovereign ratings due to RBI Governor Raghuram Rajan's decision against a second term, leading global rating agency Fitch has stated that policies are more important than personalities, on this front. The government's announcement of a further liberation of foreign direct investment (FDI) in aviation, pharmaceutical, defence, trading in food products and single brand retail trading too aided gains on the domestic bourses. Investors' sentiment also remained buoyant with Economic Affairs Secretary Shaktikanta Das' statement that the country's GDP growth is likely to touch 8 per cent in the current fiscal 2016-17, on the back of above normal monsoon. Das expressed hope that the likely passage of Goods and Services Tax (GST) bill in Parliament would add to the business sentiment and will further help in country's growth. Some support also came in with the report that quick progress of monsoon in last one-two days has taken the crucial weather system to many new regions and is expected to intensify in the days ahead.
On the global front, Asian markets ended higher, with Japanese stocks gaining the most. European markets were trading higher, led by heavyweight banking stocks, as opinion polls in Britain over the weekend, ahead of the referendum on Thursday, increased the possibility that Britain would continue to remain in the European Union.
Back home, soon after gap down opening, Indian equity benchmark entered into positive territory and extended its gains to reach intraday high. Finally, Nifty ended with the gains of over 68 points. The top gainers from the F&O segment were Jet Airways (India), Unitech and Vedanta. On the other hand, the top losers were Indiabulls Real Estate, PC Jeweller and NHPC. In the index options segment, maximum OI was being seen in the 8000-8500 calls and 7000-8200 puts. In today's session, while the traders preferred to exit 8000 put, heavy buildup was seen in the 8100 put. On the other hand, traders exited from 8200 Call, while 8400 call witnessed considerable OI addition.
The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 0.97% and reached 17.51. The 50-share Nifty was up by 68.30 points or 0.84% to settle at 8,238.50.
Nifty June 2016 futures closed at 8251.90 on Monday at a premium of 13.40 points over spot closing of 8,238.50, while Nifty July 2016 futures ended at 8280.45 at a premium of 41.95 points over spot closing. Nifty June futures saw addition of 0.41 million (mn) units, taking the total outstanding open interest (OI) to 17.47 million (mn) units. The near month derivatives contract will expire on June 30, 2016.
From the most active contracts, State Bank of India June 2016 futures traded at a premium of 0.95 points at 216.20 compared with spot closing of 215.25. The number of contracts traded were 39,454.
ICICI Bank June 2016 futures traded at a premium of 0.25 points at 239.25 compared with spot closing of 239.00. The number of contracts traded were 17,413.
DLF June 2016 futures traded at a premium of 0.55 points at 138.85 compared with spot closing of 138.30. The number of contracts traded were 13,193.
Punjab National Bank June 2016 futures traded at a discount of 0.40 points at 95.90 compared with spot closing of 96.30. The number of contracts traded were 10,129.
Axis Bank June 2016 futures traded at a premium of 2.55 points at 524.80 compared with spot closing of 522.25. The number of contracts traded were 16,816.
Among Nifty calls, 8300 SP from the June month expiry was the most active call with a contraction of 0.21 million open interests. Among Nifty puts, 8100 SP from the June month expiry was the most active put with an addition of 1.05 million open interests. The maximum OI outstanding for Calls was at 8300 SP (6.30 mn) and that for Puts was at 8000 SP (7.68 mn). The respective Support and Resistance levels of Nifty are: Resistance 8285.98 --- Pivot Point 8196.67 --- Support --- 8149.18.
The Nifty Put Call Ratio (PCR) finally stood at 1.31 for June month contract. The top five scrips with highest PCR on OI were Indo Count Industries (1.70), Hindalco (1.42), Apollo Hospital (1.35), Indusind Bank (1.30) and Container Corporation of India (1.19).
Among most active underlying, State Bank of India witnessed a contraction of 0.31 million of Open Interest in the June month futures contract, followed Tata Motors witnessing an addition of 0.21 million of Open Interest in the June month contract; Tata Steel witnessed a contraction of 0.45 million of Open Interest in the June month contract, DLF witnessed a contraction of 1.35 million of Open Interest in the June month contract and Reliance Industries witnessed a contraction of 0.88 million units of Open Interest in the June month's future contract.
